主题：11/06/2009 Market View -- 宁子

Same store sales point to a weak Christmas.

As noted, retail comps were the worst ever. WMT beat expectations with a 2.4% gain, but that is a recession story as we reported over a year ago. There were other solid performances, e.g. BKE (+14%), but the majority were really bad. TGT -4.8%; ANF -22%; TLB; -14%; JWN -16%, COST -4%. BJ, a wholesale club, posted strong results but said it was on its discount gasoline sales. Money being burned in the gas tank is not money that drives the economy so to speak.

The poor results and the other weak economic data have visions of failure dancing in retailer's heads. Estimates after these numbers point to the worst holiday season since the 1960's, whatever that means. That kind of comparison is hard to make, but given the differences in the standard of living between those times you can draw your own conclusions. Does that mean we buy the kids slinkys, hula hoops, and Frisbees? Or translated into today's terms is that a $200 laptop at Target or a massively discounted iPod?

What does that mean for retail overall? It means some are not going to make it after the holiday season. Mervyns is already gone. Linens-n-Things as well. They show retail in distress ahead of the holiday season, and if the holidays don't provide the rain of profits needed to keep retail alive the rest of the year similar to how the monsoon season revives and saves the Serengeti each year, stores will perish. Circuit City. Some department stores. It won't be a fun first couple of quarters for retail in 2009.